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In the midst of the transition to an unprecedented left-wing government, in which President-elect Andrés Manuel López Obrador is in office only on December 1, Mexico has the difficult task of trying to convince US Government, (19659002) Since Donald Trump surprised partners by threatening to pull the United States out of NAFTA, Mexico was looking for other markets for their manufactured goods. However, it is not easy to replace the neighbor, the world's largest economy, and those who do business even before the entry into force of NAFTA. "It's hard to overcome that, but we can start looking at other economies, like Brazil," says Beatriz Leycegui, an IAD consultant and former Undersecretary of Foreign Trade.
Lopez Obrador himself, an unconditional critic of NAFTA. wants to renegotiate the agreement as soon as possible. Shortly after his victory, he declared that he wanted a relationship of mutual respect with Trump, recalls former Vice Chancellor Andres Rozental. "But that is practically impossible, we know that Trump does not even respect his closest allies, what he will say about Mexico and the Mexicans."
On Friday, the President-elect met for the first time with US Secretary of the United States Mike Pompeo and Treasury Secretary Steven Mnuchin in Mexico City to discuss issues such as Immigration and Commerce.
Economists and commercial experts heard by Value state that the basic upgrade of the trilateral agreement is the preferential option for Mexico. The second would be a bilateral agreement with the United States, as proposed by Trump. The third is to increase trade with markets such as Japan, China, Brazil and the European Union (EU), in the hope that they can replace the United States. United in the long run.
"Mexico should insist on the trilateral agreement that has common positions in almost 90% of contentious issues," says Leycegui.
Renegotiation of an existing agreement is more advantageous for Mexico that to go to a bilateral agreement from scratch, says Ernesto Revilla, chief economist at Citi Bank for Latin America. "With the already existing agreement, Mexico can take advantage of the benefits of the region, integrated production chains in the three countries, which would have a much greater impact than a bilateral agreement, which is why Mexico continues to negotiate. "
For Fernando Murillo of Oxford Economics, Mexico's priority is to continue exporting to the United States without trade barriers and to continue to invest in Mexico." According to him, it does not matter whether the agreement Bilateral with the United States or with Canada
The United States is the main source of foreign direct investment (FDI) in Mexico and the main destination for Mexican exports. the most open countries in the world: it maintains ten free trade agreements with 45 countries and is part of TPP-1, the trans-Pacific partnership without the US The country is behind only Chile, which has 26 agreements with 64
The search to open up even more to the world gained strength last year, Rozental said. "Since the US President began to threaten tariffs and barriers, efforts are being made. deployed to find other sources of 9, export and import, although it is impossible to replace 100% of trade with the United States and Canada ". cereal purchases from Brazil and Argentina
Among the problems that hinder the renegotiation of NAFTA include changes in the content of the Rule of Origin – in which the United States want to go from 62.5% to 75%; and the controversial sunset clause under which the agreement should be renegotiated every five years.
Another question that has permeated the discussions is that of wages. The United States has proposed that cars be made by workers who earn $ 16 an hour. Workers in Mexican car makers receive $ 6 per hour worked and employees of auto parts companies receive $ 3 per hour.
For Carlos Heredia, of the Center for Research and Economic Education (Cide), the American proposal forces Mexico to review their wage policy. "López Obrador said he would retain the current negotiating team, but will include Jesús Seade, who participated in the negotiations for accession to the General Agreement on Tariffs and Trade (GATT) in 1986 "Wages will be a headache for Mexico. "
Trump said that he would wait for the November parliamentary elections to decide on NAFTA." Congress permission to negotiate treaties expired on June 30. To resume negotiations, Trump must call a new trade promotion authority, known as the "fast track".
But it all depends on the US-Chinese escalation, says Rafael Fernández, director of the American Studies Center. Mexican from the University of California, San Diego. "The longer the trade war with China, the greater the chances of the new NAFTA," he said. "The United States will barely get into another war with two trading partners. "
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